At a round-table discussion this morning at the Southern Connecticut Regional Council of Governments office in North Haven, U.S. Rep. Rosa DeLauro (D-3) discussed a four-point plan to boost the economy with local business leaders, economists and workers.
Encompassing a broad range of incentives, programs, and financial solutions aimed at helping small businesses, utility and construction industries, and the unemployed, DeLauro's proposal consists of four bills currently under review by the House:
- National Infrastructure Bank Act (H.R. 402)
- Manufacturing Reinvestment Account Act (H.R. 110)
- Layoff Prevention Act (H.R. 2421)
- Fair Employment Opportunity Act (H.R. 2501)
Taken together, the legislation aims to, in the Congresswoman's words, "Put America back to work while rebuilding our country, growing our manufacturing capacity, and fueling business innovation."
"We are no longer a nation that builds things," said DeLauro to preface the meeting. "Instead, we have become a country that consumes what others build. That's not the way it should be."
The National Infrastructural Bank Act, currently before the House Subcommittee on Domestic Monetary Policy and Technology, aims to bolster the rebuilding of America's aging infrastructure through the creation of a government-owned bank responsible for leveraging private dollars to invest in bridges, rail systems, air transport, energy grids, telecommunication lines, and other projects of regional and national necessity.
"There are billions of dollars in private money available to invest in infrastructure," said Don Shubert of the Connecticut Construction Industries Association. "A dedicated infrastructure bank makes sense, and it has for a long time."
Despite bipartisan support for the concept, Shubert worried that the rancorous political climate in Washington could derail the bill. "What's holding up the process is widespread panic over government involvement in business," he said.
DeLauro stressed the importance of infrastructure as a driver of economic growth, clarifying that the plan is not to privatize public resources, but rather to guide private capital into large-scale civic projects.
"China devotes 9 percent of its GDP to infrastructure. There's a European infrastructure bank managing resources for high-speed rail. Brazil has worked on the idea," she said, citing successful international models of the proposed bill.
Edward Deak, an economics professor at Fairfield University and a past adviser to former Connecticut Gov. M. Jodi Rell, noted the abundance of resources available for such an initiative.
"Corporate balance sheets have never been fatter than they are right now," he said. "They're holding onto that money. The key to making private investment in infrastructure attractive is to prove that these projects will be self-liquidating, and generate revenue."
Big Returns for Small Businesses
The second component of DeLauro's plan, the Managing Reinvestment Account Act, is to assist small manufacturing companies by allowing them to make pre-tax contributions of up to $500,000 to special accounts (MRA's) set up at community banks. Distributions from these MRA accounts, taxed at a low 15-percent rate, can then be used only for the purchase of equipment and facilities for job training.
Jamie Scott, of Air Handling Systems in Woodbridge, said this legislation provides a much-needed incentive for small business owners to reinvest in their own companies.
"An MRA is just like an IRA, but for small corporations," he explained. "Small businesses are the engines of economic growth. They help Main Street, curb unemployment, and they give hope to the small man trying to make ends meet."
The bill, H.R. 110, is currently before the House Committee on Ways and Means.
Sharing the Load
Up next, the panel discussed the Layoff Prevention Act, a bill designed to provide businesses with alternatives to laying off employees that simultaneously cuts rehiring costs for companies, and reduces unemployment among workers.
Such "work sharing" programs, currently active in 23 states, including Connecticut, allow companies to reduce work hours without firing employees, and provide workers with government benefits to compensate for lost wages.
H.R. 2421, now before the House Committee on Ways and Means, would widen the reach of these efforts, and strengthen the incentives already available for participating businesses.
Attendees at the round-table praised the ease of applying to the program, and commented on its value in improving employee morale at struggling companies.
"Work sharing maintains the esprit de corps in the corporation and the community," noted one business owner. "So far, the program has worked out really well for us."
Getting Back into the Game
Finally, DeLauro talked to the group about the Fair Employment Opportunity Act, a proposed piece of legislation that would make it illegal for employers to refuse to consider a job applicant based on his or her unemployment status.
"The recession has taken an incredible toll on the dreams and aspirations of American workers," said George Wentworth of the National Employment Law Project. "We talk to men and women everyday who are fighting against negative stereotyping in the job market."
"There seems to be the false perception that if someone has been unemployed for a long period of time, then something must be wrong with him," he added.
By outlawing discrimination against applicants based on employment status, DeLauro hopes to renew faith amongst workers who fear they may have lost their edge in today's turbulent economy.
"We define ourselves by what our jobs are, how we contribute to society," DeLauro said. "The system we have is broken. It's vital that unemployed people understand that they are competent at what they do, that they have marketable skills, and that they have support."
The House remains in recess for the rest of August, and will resume its work Sept. 5.
Complicated by a Lack of Confidence
While many at the meeting expressed doubts that the economy would turn around after the 2012 elections, DeLauro contended that what the nation lacks most at the moment is confidence in their government to establish a blueprint for the way forward.
"What we need is not just one program, but a series of pieces we can begin to work with," she said. "We need to begin to marshal resources around this kind of work. You have a sense or urgency, I have a sense of urgency, and the nation has a sense of urgency about the long-term economic viability of this country."